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Topic: Financial modelling-how do YOU do it? (Read 2150 times)

So my husband booked us in for a free consultation with a financial planner. It was an interesting experience as it finally got hubs interested in our financial future, but I would never pay a cent for this guy's services as the fee he quoted was absolutely ridiculous. Like he expects us to hand over 5k for an initial plan and financial modelling in good faith and also expects us to pay him 300 a month(!) management fee. No returns guaranteed, of course :D I like it when I'm taken for a complete idiot just because I smile a lot.

It just reinforces my view that once you have a bit of money the Sharks start circling. Fuck them.

Anyway, just wondering, what calculators/ systems do you guys use for financial modelling apart from good old excel? Like, if we do x we'll be at x+ n in 10 years, these are the risks/ opportunities. How do you evaluate the different scenarios?

A Retirement plan from an hourly / lump sum financial planner is normally about $2500. They take about 16 hours to put together, and use modelling tools and software (usually).

RRIFmetric is one that I have checked out and like. You can send them your data to them, and they will run it for you for about $50, I think.Several other software packages exist that the planners use, too.-----------------On-going coaching and advice for a monthly call would be $100/month for most planners. This gets you a half hour call, every month, som monthly topic newsletter (often with current actions targeted to your situation and season) with maybe some reasearch time on a specific financial question. This low rate is after you sign up for a comprehensive plan where most of the work and learning about you has occurred.

--------------------------------------If you are talking about investing, just go with a simple index plan, with asset allocation targeted to your goals, that you manage yourself.

Beats a 1% annual fee of your total stock portfolio. If this is what your $300 is for, and you have a large portfolio over $400k AND the planner does not get other commissions, it is a steal, in planner world. But man, the planner has to EARN it, you know?. Especially compared to what you can do for yourself, lazy style.

Thanks for that, I'll check that out. I knew that the dude was trying to take us for a ride, especially after emphasising that we are lazy and the husband has 0 interest. Hehe. That portfolio he is supposed to put together must be doing exceptionally well, just to pay his fees. I can't believe people buy into this shit.

There are tons of free online calculators, including this one https://www.chrishogan360.com/riq/ but the main problem with all of them is that you have to make up numbers. What do you think the market will do? What about inflation? What about __________

We had consultations with three different advisors and decided to do it ourselves as well. We decided on percentages for bonds, REITs, international, and US investments and then bought index funds in each category. Instead of selling to rebalance, we just keep an eye on which ones are under the target investment percentage and add more to those when we have extra savings.

Bogleheads is a great place to start. There's at least one book and an excellent forum.

It just reinforces my view that once you have a bit of money the Sharks start circling. Fuck them.

This made me laugh.

The financial industry has incentives to confuse you with big equations and complex structured products. And if you object then "you just don't understand".

Finance is really easy and there's no magic bullet other than to save and invest in regular intervals over a long period of time. As for models, there's a ton of free resources littered throughout the internet. I prefer to keep it pretty simple with an overall NW, investable assets, and expenses.

You can factor in inflation estimates and other what-ifs, but I don't think they provide a ton of value because they're such big question marks.

This is why I am asking what you guys are doing, ie what worked for you in the planning department.. There is so much information floating around, it is not easy to pick the right one.

I think I read most of the decent books available on the topic and I do have a financial plan based on our circumstances, I have some strategies I am comfortable with, and I think we are on the right track, but it would be handy to have something else to help me persuade my husband that we are on the right track.

The best outcome of this financial planning zoo was that we came home and husband picked a vanguard fund. Just to spite the man in the suit.

This is why I am asking what you guys are doing, ie what worked for you in the planning department.. There is so much information floating around, it is not easy to pick the right one.

The bogleheads link goes to a post that does a good job outlining what makes a planning tool good.

To clarify, we have used (and continue to use) Quicken's Lifetime Planner and have looked at www.i-orp.com, www.cfiresim.com, Fidelity's planner, and probably a few others, all of which told us similar things. Because we use Quicken anyway, that remains our go-to "are we doing ok?" tool, even though there are things about it that could be better.

I work as a financial planner full-time at a place that is known for comprehensive planning knowledge. We have tax experts, estate experts, insurance experts, investment experts, etc. I personally create or collaborate on ~30 of these plans/month (mostly on investment side).

The cost for a full comprehensive plan is ~$900. Our average plan time is ~8-10 hours. You will also get complete estate, tax, and insurance planning, unlike most firms who masquerade as comprehensive planning but are just investment allocaters.

Just wanted to give you a reference point for his absurd fee.

edit: And yes we have access to all the software and monte carlo tools out there.

Thanks guys. I knew that it was completely ridiculous. Plus it was funny that he tried to sell us a comprehensive plan, even though we are debt free, tax and estate planning is covered, insurance is ok, so wtf. I think that he was taken a bit by surprise by it and just misjudged the situation.

We do discuss finances with my husband ( reluctantly), we are in a good place I think, given the circumstances. I am just looking for some 'are we doing OK' tools, what can we do better. The process is a bit tedious though: usually I do some planning, crunch some numbers, start drip feeding the information to him until it gets his attention, he calls me delusional but gets convinced by the numbers, sits on it a bit, then embraces the plan. It is frustrating because he is the smart one, the numbers guy, I am just a planner, but obviously more motivated than him.. Anyway, we are getting there.

Keep the suggestions coming, they are really useful..i already checked out some, thanks for taking the time to comment, I really appreciate it.